I am the founding executive director of the George W. Bush Institute, part of the George W. Bush Presidential Center in Dallas, Texas, located on the campus of Southern Methodist University. I also host and moderate “Ideas in Action,” a weekly television series on public policy issues. You may recognize my face from the 1990s show “Capital Gang Sunday” on CNN or “TechnoPolitics” on PBS.
I've been a journalist and in publishing all my life. I was president of the Atlantic Monthly magazine, publisher of the New Republic magazine, executive vice president of U.S. News & World Report, and editor and co-owner of Roll Call, the Congressional newspaper. My career started shortly after graduating from Harvard (where I was managing editor of The Crimson) when I started a weekly newspaper in New Orleans called Figaro.
From June 2008 to January 2009, I had the pleasure of serving as Under Secretary of State for Public Diplomacy and Public Affairs under President George W. Bush, and before that, as chairman of the Broadcasting Board of Governors.
I've written three books on investing, and my articles on finance, economics, and foreign policy have appeared in the New York Times, Wall Street Journal, Los Angeles Times, Kiplinger’s Personal Finance, Forbes, among others. I currently sit on the Investor Advisory Committee of the U.S. Securities and Exchange Commission.

Weighing in at 844 pages, the immigration bill that the bipartisan Gang of Eight delivered to the Senate on April 17 has something for everyone: border security, a path to legalization for millions of the undocumented, an extension of the DREAM Act to help students become citizens, and more visas for skilled workers.

Well educated, high-skilled immigrants could play a major role in increasing America’s economic growth, which has been stuck since the recession below 2 percent – far below the 4 percent range that prevailed after past downturns. Boosting growth would mean lower unemployment, less burdensome debt, and more opportunities for entrepreneurs and the people who work for them. Right now, along with more open trade, a better immigration policy is probably the fastest way to get significantly stronger growth

The reason is simple. Growth requires capital – that is, a base of assets on which enterprise can draw. There are financial assets like cash and stock, physical assets like factories and petroleum, and, finally, human assets like the skills and ingenuity of a nation’s population.

Unfortunately, while the hefty immigration bill is, in some ways, a slight improvement over the current system when it comes to attracting skilled immigrants, in other ways, it moves in precisely the wrong direction at precisely the wrong time.

To understand why, you need to understand human capital. During a 2011 conference in Dallas, economist Gary Becker of the University of Chicago, who won the Nobel Prize for his work in human capital, said that raising student achievement by reforming education would have a significant effect on growth.

But school reform, he conceded, will take a long time. Instead, said Becker, the fastest way to enhance our supply of human capital is to encourage the best and brightest foreigners to live and work in the United States, rather than getting educated here and, in many cases, being forced, for lack of a long-term visa or a means to citizenship, to return home

As Becker wrote in The 4% Solution, a book on growth-boosting policy ideas, “Immigration, especially legal immigration, is good for a country like the United States that has many opportunities for ambitious and hardworking men and women. Immigration increases a country’s human capital. That is to say, it increases the number of workers available to help businesses expand or innovators make the next big breakthrough.”Economists Pia M. Orrenius and Madeline Zavodny write, “Immigrants are more entrepreneurial are typically more entrepreneurial than natives in the United States.” One-fourth of all high-tech start-ups between 1995 and 2005 had at least one immigrant founder, and immigrants were responsible for founding more than half the firms in Silicon Valley. Immigrants have started such great American businesses as DuPont, Procter & Gamble, Pfizer, U.S. Steel, and, more recently, Google, Yahoo, and eBay.

Immigrants account for fully one-fourth of all U.S. patent applications even though they comprise one-eighth of the population — and publish scholarly works at a higher rate than native-born Americans. Immigrants own businesses at 40 percent higher rate than native Americans, and they are more likely than natives to own a company with 10 or more employees. Between 1990 and 2010, immigrants accounted for 30 percent of the growth of small-businesses in the United States. Only 8.7 percent of immigrants are employed by government, compared with 16.3 percent of natives, and far more immigrants are of working age than natives.

With all these benefits flowing from skilled immigration, you might think that the new bill would open the door wider – or open it all the way, to compete with other nations, like Canada and Australia.

The U.S. currently extends 65,000 H1B visas for skilled workers, plus another 20,000 visas for foreign graduates and 140,000 green cards, or visas to workers that can lead to eventual citizenship. That’s 225,000 skilled foreigners a year, or a more 0.1 percent of the U.S. workforce, as Edward Luce pointed out recently in the Financial Times.

Under our immigration system, H1B visas are critical. Thomas Friedman in the New York Times pointed to a study by William R. Kerr of the Harvard Business School and William F. Lincoln of the University of Michigan found that “in periods when H1B visa numbers went down, so did patent applications filed by immigrants [in the U.S.]. And when H1B visa numbers went up, patent applications followed suit.”

So what does the Gang of Eight bill do? It roughly doubles the number of available H1B visas each year – a paltry increase that leaves levels well below those in the early 1990s, when immigrants ignited the Silicon Valley boom. Even worse, the bill slaps restrictions on any company whose workforce exceeds a threshold of 10 percent H1B visa holders – a decrease from the current threshold of 15 percent.

A company that exceeds the threshold, or “H1B-dependent employer,” cannot, among other things, displace a current U.S. worker for 180 days before and 180 days after filing an H1B petition (the current limits are 90 days before and after). The employer also has to meet standards for “good faith steps to recruit” U.S. workers, including advertising on a Department of Labor website.

Also, currently, graduates holding a Master’s degree or higher are not counted toward the calculation of whether an employer is “H1B-dependent” or not. That exemption is eliminated in the new bill. In addition, these dependent firms cannot lease, contract, or outsource their H1B employees to work for other firms. With higher proportions of H1B workers, large companies would have to pay fees of $10,000 per visa (double the current fee) and would face outright bans.

While I take no position on the specifics of the legislation, I find the approach that the Gang of Eight has taken on skilled immigrants hugely disappointing. Asked in 2005 what he would do to encourage scientific research and development in the United States, Bill Gates quickly responded, “I’d certainly get rid of the H1B cap.”

That is the obvious solution. Fear of displacing native workers is a canard, an absurdity really. A recent report by McKinsey & Co. estimates that by 2020 there will be 1.5 million more openings requiring a bachelor’s degree in the U.S. workforce than there are candidates for jobs. The key shortage is among jobs that require a strong background in STEM (science, technology, engineering, and mathematics. The STEM shortage hurts nearly every U.S. tech firm.

Currently, for example, most Fortune 500 firms run their core computing platforms and business-process technologies using services firms that employ H1B visa holders. Restricting the growth of skilled immigration to the U.S. will mean shipping those operations overseas – and with them, jobs currently held by native-born Americans.

Comprehensive immigration reform provides the chance, at long last, to increase U.S. economic growth by making America more attractive to the best and brightest immigrants. Let’s not squander the opportunity.

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